TRANSPORTATION
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Transportation
Because Kazakhstan is mostly a landlocked country, greater export production need improved transportation infrastructure. Fortunately, this infrastructure has improved significantly in recent years. Tolkynneftegaz TOO has consistent access to pipeline infrastructure thanks to its strong relationship with the parent business. The UAS and CPC pipelines are important export routes for the company. The major supplier to the Atyrau refinery is KMG EP. Tolkynneftegaz TOO is a Kazakhstan-China pipeline supplier of crude oil.
Until recently, the Company’s principal export outlet was Russia, via the 1,500-kilometer Uzen-Atyrau-Samara (UAS) pipeline to Samara, which is the main export outlet. This has been supplemented since 2001 by the Caspian Pipeline Consortium’s (CPC) 1,510 km pipeline to the Russian city-port of Novorossiysk on the Black Sea – a more profitable route for the Company and the reason for our efforts to enhance the proportion of exports via CPC.
The 1,000-kilometer Atasu-Alashankou pipeline between Kazakhstan and China went live in December 2005, with a capacity of 10 million tonnes per annum (200 kbopd) that is expected to expand in the future years. Other Kazakhstan pipeline routes are being considered. In July 2007 an alternate route has been developed: the first direct pipeline with anticipated capacity of 50 million tonnes (1,000 kbopd) link between the Caspian and the Mediterranean Sea. The Baku-Tbilisi-Ceyhan pipeline connects Baku, Azerbaijan, with Ceyhan, Turkey, and was launched in July 2006. This pipeline is a potential alternative route for Kazakhstan’s oil.
Despite Kazakhstan’s reliance on its neighbors to export its oil outside, the country has a rapidly expanding and diverse export market. The Business has secured access to Tolkynneftegaz TOO’s oil transport infrastructure because to our solid connections with our parent company. Tolkynneftegaz TOO exported 59% of crude oil produced on its core assets UMG and EMG in 2016. During this time, the CPC pipeline exported 26% of the Company’s crude oil sales while the UAS pipeline exported 33%.
